Athletic apparel and footwear is considered a slow-growth market, with a projected compound annual growth rate of just 4.3% between 2015 and 2020, according to Allied Market Research.
The bankruptcy of Sports Authority last year was a red flag for investors, indicating that consumer demand was waning across the saturated market. Let's examine four major players in this space -- Nike (NYSE:NKE), Adidas (NASDAQOTH:ADDYY), Under Armour (NYSE:UAA) (NYSE:UA), and Puma -- to learn more.
Nike and Adidas still clearly rule the global market. But Nike and Under Armour currently face slower growth in North America, where Adidas and Puma are gaining ground with "retro chic" and celebrity-designed footwear. Meanwhile, a flood of excess inventory from Sports Authority is causing steep price cuts. This makes it tough for smaller players with slowing growth -- like Under Armour -- to remain competitive.
Looking ahead, all four companies are expanding their "athleisure" offerings to capitalize on the growing demand for fashionable athletic apparel. That move should cause the segment to shift away from utilitarian designs toward more fashion-oriented ones, but it's unclear if it will jump-start this aging market.